EInvestors in exchange-traded funds should explore the future of autonomous technology robotics.
In the recent webcast, Drones, Robotaxis, 3D printing and more: investing in autonomous technologies, Tasha Keeney, Analyst, ARK; and Matt Murphy, vice president, national ETF sales, Resolute Investment Managers, highlighted advancements in autonomous technologies that could open up growth opportunities for investors.
For example, autonomous carpooling will likely become more affordable than personal vehicles. Adjusted for inflation, the cost of owning and operating a personal car has not changed since the Model T. ARK estimates that on a large scale, self-driving taxis will cost consumers 0.25 $ per mile, which will drive their widespread adoption.
According to ARK research, the VTC market today generates around $ 150 billion in revenue globally with take rates of 10-30% and profit margins of up to 50% in top-performing cities. Going forward, autonomous carpooling could generate 50% margins, but its low price is expected to increase the total market from $ 150 billion in revenue with take rates of 60% to $ 6 trillion to $ 7 trillion. ‘by 2030.
ARK believes that autonomous ride-sharing platforms could generate more than $ 1 trillion in operating profits per year by 2030. Additionally, the business value for autonomous platform operators could reach $ 3.8 trillion by 2025.
Autonomous air travel, or drone delivery, could also gain more adoption and be more affordable. Battery technology is improving enough for flight energy reserves to meet regulations, allowing air taxis and air ambulances to fly safely. Additionally, machine learning improvements have enabled autonomous flight, significantly reducing costs. For example, drone delivery could provide cheaper or faster service in areas such as pharmaceutical delivery, bridge inspection, and parcel delivery.
While not yet commercialized, ARK predicts that drone delivery platforms will generate nearly $ 50 billion in revenue, $ 14 billion in hardware sales, and $ 3 billion in mapping revenue. by 2025.
As 3D printing revenues declined in 2020, new users took advantage of the technology during the Covid-19 pandemic, and growth may continue. Investors are already seeing larger 3D printing applications in medical devices, test devices, training, visualization aids, personal protective equipment, personal accessories and emergency housing. ARK research indicates that 3D printing for end-use parts is the next frontier, with an expected market potential of $ 490 billion.
ARK believes the global 3D printing market will grow at a compound annual rate of 60% over the next five years, from $ 12 billion to around $ 120 billion by 2025.
In order to seize this potential opportunity, investors can turn to ETF strategies, such as the ARK ETF on Autonomous Technology and Robotics (NYSEArca: ARKQ). The ETF ARK Autonomous Technology & Robotics focuses on companies that are expected to benefit significantly from the development of new products or services, technological improvements and advances in scientific research related to, among others, energy, automation and manufacturing, materials and transportation. The ETF captures converging industrial and technological sectors, capitalizing on autonomous vehicles, robotics, 3D printing, energy storage and space exploration technologies. ETFs can offer long-term growth potential with a low correlation between relative returns and traditional growth strategies and a negative correlation with value strategies. ARKQ offers better diversification due to its low overlap with traditional indices, complementing a traditional portfolio of value and growth.
Financial advisers who want to learn more about innovative technologies can watch the webcast here on request.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.